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Updated from 4:14 p.m. EDT

Stocks had an up-and-down session to start the week, but the major averages closed higher Monday as chip shares, retailers and the housing sector drew interest amid end-of-quarter buying.


Dow Jones Industrial Average

climbed 67.71 points, or 0.59%, to 11,575.81, and the

S&P 500

tacked on 11.59 points, or 0.88%, to 1326.37. The

Nasdaq Composite

surged 30.14 points, or 1.36%, to 2249.07.

Gains of 1.8% or more in


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supported the Dow.

The Nasdaq benefited from advances of nearly 9% in




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"Since the markets are forward-looking, we now begin to look for the groups that will be the leaders coming out of whatever economic slowdown may be ahead," said Paul Nolte, director of investments with Hinsdale Associates. "Usually those tied to consumer spending begin to show life as the consumer comes out from under the rocks."

September is historically a weak month for the major indices, but this year it hasn't been. With only four sessions left, the Dow is higher by 195 points, or 1.7%. The S&P 500 has gained 22.5 points, or 1.7%, and the Nasdaq has tacked on 65 points, or 3%.

About 2.71 billion shares changed hands on the

New York Stock Exchange

. Advancers beat decliners by a 2-to-1 margin. Volume on the Nasdaq was 1.88 billion shares, and winners led losers 3 to 2.

Crude prices rebounded to rise 90 cents to close at $61.45 a barrel. Oil had been weaker after


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said it would restart the eastern half of its Prudhoe Bay oil field in Alaska. Last month, BP stopped production at Prudhoe Bay to repair a leak in a pipeline, removing 400,000 barrels a day from the world's supply. Since then, oil prices have dropped more than 20%.

"If the market rallies to all-time highs, the question is whether the lagging groups participate or not," said Michael Sheldon, chief market strategist with Spencer Clarke LLC. "The rebound in energy prices certainly helped stocks. Other than that, this isn't based on any real news. We may also be seeing some end-of-month and end-of-quarter buying kicking in."

To view Farnoosh Torabi's video take on today's market, click here


The major indices charged higher at the start of the session but retreated and turned lower after the National Association of Realtors said last month's existing-home sales fell 0.5% from July to 6.3 million annualized units. August's sales of previously owned houses dropped 12.6% year over year.

Later this week, reports on durable-goods orders, new-home sales, second-quarter gross domestic product and consumer sentiment are due.

Contributing to the earlier pullback was Dallas

Federal Reserve

President Richard Fischer, who, while speaking in Mexico, said inflation would remain high on his radar. Fischer said he "continues to fret more about inflation than I do about growth. The most reliable indicators of inflationary pressure are not yet comforting. Inflation remains elevated and leaves us small choice but to remain vigilant."

Treasuries continued their ascent after the existing-homes data. The benchmark 10-year note was up 13/32 in price and yielding 4.54%. Precious metals ended the session higher, with gold up 50 cents to close at $595.90 an ounce and silver stronger by 2 cents at $11.33 an ounce.

Falling yields suggest investors are looking for a dropoff in the economy and in rates, and in fact, the fed funds futures market is now pricing in 20% odds of a rate cut at the U.S. central bank's December meeting and a 50% chance of a reduction at the January gathering of policymakers. Meanwhile, the Philadelphia Housing Sector index added 2.4% as construction companies welcomed falling yields.

Among other sectors, both the Amex Securities Broker/Dealer Index and the Philadelphia/KBW Bank Sector Index benefited from lower yields and rumors that

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could potentially be a takeover target.

Elsewhere, the Philadelphia Semiconductor Sector index jumped 2.5%, and both the S&P Retail index and the Amex Airline index were higher by 1.9%. The Dow Jones Transportation Index finished up 0.4%.

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Dow component


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sank 6.4% after a federal judge in New York ruled that a lawsuit accusing tobacco companies of fooling smokers into thinking "light" cigarettes were safer than regular ones can become a class action.

Reynolds American


fell 3.7%.



posted fiscal fourth-quarter earnings of $412.3 million, or 41 cents a share, rising from $329 million, or 32 cents a share, in the year-ago period. Sales increased to $12.2 billion from $10.5 billion last year. The Thomson First Call consensus was for EPS of 41 cents on revenue of $12 billion. Still, Walgreen dropped $2.43, or 5.2%, to $44.47.

Among the day's research reports, Morgan Stanley upgraded

Time Warner


to overweight from equal-weight, UBS cut its ratings on

U.S. Steel

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, and ThinkEquity lifted its price target on


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to $100 from $90.

After the close Friday,


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Chief Executive Mark Hurd held a press conference to discuss the company's probe into a secret effort to try and determine who on the board was leaking confidential information to reporters.

During his briefing, Hurd said Chairwoman Patricia Dunn was resigning immediately and won't stay on the board. Previously, Dunn had planned to continue as chair until January before stepping aside for Hurd, and then remain as a director. H-P added 60 cents, or 1.7%, to finish at $35.71.

Also following the previous close,



cut its guidance, saying fourth-quarter revenue would be flat to up 2% sequentially. The company forecast a profit of 25 cents to 27 cents a share, excluding items, below the consensus estimate of 30 cents. Shares plummeted 14% to $19.59.

Overseas, Europe's equities ended mixed. London's FTSE 100 lost 0.4% to 5798, and Frankfurt's Xetra DAX rose 0.3% to 5901. Asia's shares edged lower, with Tokyo's Nikkei dipping 0.1% to 15,632 and Hong Kong's Hang Seng closing down 0.3% at 17,546.

To view Gregg Greenberg's video take on today's market, click here